Stimulation of entrepreneurship in Spain: reduced social security fee new freelancers

By: Transfer Business Administration Services Spain

Everyone who works as a freelancer (autónomo) in Spain is required to register to the regime of self-employed persons in the Social Security system (Seguridad Social) formally known as RETA or Regimen Especial Trabajadores Autónomo. Once registered, the freelancer will have to pay a monthly social security fee, independent of earnings and costs in that month. The minimum monthly social security contribution (base fee) is currently about €300 a month.

In February 2013, the Spanish government introduced a reduced social security fee for new freelancers under the age of 30 years old. Recently this reduction has been extended to new freelancers with 30 years or over to stimulate entrepreneurship (BOE de la Ley 14/2013, September 27, 2013).

For new freelancers the following reductions now apply:

  • First 6 months: An 80% social security fee reduction during the first six months, leading to a monthly social security fee of approximately 50 euros in 2014;
  • Month 7 to 12: A 50% social security fee reduction for the 6 months thereafter, leading to a monthly social security fee of approximately 130 euros in 2014;
  • Month 13 to 18: A 30% social security fee reduction during the next 6 months thereafter, leading to monthly social security fee of approximately 183 euros in 2014.
  • For men under 30, and women under 35 years old, the following extension applies: Month 19 to 30: A 30% social security fee reduction during the next 12 months leaving the monthly social security fee at approximately 183 euros in 2014.

To be eligible for the reduced social security contribution the following conditions have to be met:

  • Not having been registered as a freelancer anytime in the preceding 5 years;
  • Not having employees;
  • Not being a director (“administrador”) of a registered company (S.L. etc);
  • Not being an “autonomo coloborador” (special category for a family member working in the family business).

For questions or more information, please do not hesitate to contact us.